NEW MODEL CLAUSE FOR PARTIES TO DESIGNATE THE SICC AS SUPERVISORY COURT FOR SINGAPORE-SEATED ARBITRATIONS

The Singapore International Commercial Court (SICC) recently introduced a new model clause allowing parties to expressly designate the SICC as having jurisdiction over court proceedings relating to Singapore-seated international arbitrations.^[1]

Parties interested in arbitrating their disputes in Singapore may wish to take note of this welcome development for the reasons set out in this note.

The SICC’s Model Clause

On 12 January 2023, the SICC launched a model clause:

“In respect of any court proceedings in Singapore commenced under the International Arbitration Act 1994 in relation to the arbitration, the parties agree: (a) to commence such proceedings before the Singapore International Commercial Court (“the SICC”); and (b) in any event, that such proceedings shall be heard and adjudicated by the SICC.”

The SICC model clause makes it easier for parties to exercise their autonomy to designate the SICC as the supervisory court for arbitration-related court proceedings in respect of Singapore-seated arbitrations. If contracting parties fail to expressly designate the SICC in their contracts (e.g., by not using the model clause), the default position is that the Singapore High Court will have jurisdiction over court proceedings in respect of Singapore-seated arbitrations. While the High Court can transfer such court proceedings to the SICC, whether by its own motion or on the application of a party, a transfer is not guaranteed.

The Singapore International Arbitration Centre (SIAC) has helpfully updated its model arbitration clauses to incorporate the SICC model clause. Accordingly, if parties included the combined SIAC and SICC clauses in their contract, they would agree to resolve their disputes through SIAC arbitration with SICC as the supervisory court.^[2]

Benefits of the SICC’s Supervisory Jurisdiction over Arbitration-Related Proceedings

The first key benefit for parties of using the SICC’s model clause is certainty that a specialised court will deal with any ancillary litigation related to their Singapore-seated arbitration.

The SICC, a specialised branch of the General Division of the Singapore High Court, is intended to deal with transnational commercial disputes.^[3] It has a bench of international judges from common and civil law jurisdictions, including foreign judges with specialised knowledge of arbitration law. The SICC counts amongst its eminent members, Lord Neuberger of Abbotsbury (U.K.), Justice Beverley McLachlin (Canada), Justice Dominique Hascher (France), Justice Robert French (Australia), and Justice Zhong Yongjian (PRC).

Given the availability of renowned international judges on the SICC panel, the SICC’s model clause may be particularly attractive where parties have designated laws other than Singapore law as the governing law for the arbitration clause or the substantive agreement. Even for matters where the governing law is Singapore law, parties stand to benefit from the SICC panel’s expertise in international arbitration and its mandate to resolve disputes speedily and efficiently.

The second key benefit is that the SICC’s cost recovery regime may be more attractive to commercial parties than that available before the Singapore High Court. In November 2022, the Singapore Court of Appeal, hearing an appeal from the SICC in Senda International Capital Ltd v Kiri Industries Ltd [2022] SGCA(I) 10 (“Senda International”), held that the recovery of “recoverable costs” by a successful party in SICC proceedings is determined by what costs were in fact incurred by that party to the extent reasonable. This decision effectively aligns the costs recovery regime in the SICC with that practiced by arbitral tribunals. Practically, this means that successful parties will be able to recover a greater proportion of their costs in arbitration-related litigation proceedings than they would before the High Court.

A third potential benefit of designating the SICC is that accredited foreign lawyers have rights of audience to make submissions on foreign law. This is however a limited right given that the proceedings under the International Arbitration Act do not fall within the definition of an “offshore case” and parties will still have to engage Singapore-qualified lawyers for the arbitration-related proceedings in the SICC.

In summary, the launch of the SICC’s jurisdiction model clause, alongside the alignment of the cost recovery regime in Senda International, represents a welcome development that further enhances Singapore’s deserved reputation as an attractive seat of arbitration.